Obama to homeowners: I didn’t say it was your fault, I said we’re going to blame you

Well, actually, he is sort of saying that homeowners were at fault for the housing crisis.  Yes, yes, MOST of us were just responsible, law-abiding citizens, living within our means, paying mortgages on our modest little townhouses as we worked at jobs we loved.  Then the bankers saw an opportunity to lend money to millions of suckers, driving the cost of housing up.  Then they securitized those loans, sliced them up into pieces, sold them to unsuspecting pension and mutual funds and created a whole new financial instrument to insure speculators against risk.

When the bubble burst and people lost their jobs and the economy was taken to the brink of Armageddon because of all of the bankers’ wild speculations, the last people on earth who were asked to take a haircut were the bankers who refused to take any losses on the mortgages they expected to make money on in perpetuity.  It didn’t matter if those same homeowners no longer had jobs or were making less money.  No, they were not going to take a penny less than they expected.  So the government bailed them out and did nothing to help people stay in their homes.  We didn’t adjust mortgage rates or write down principal or stop anyone from being thrown into the street.  Because early on, THIS administration decided to bail out the bankers over everyone else.

And now, future homeowners will also suffer.  This administration has decided to get out of the housing business and let the private sector take over.  The cost of owning a house is expected to go up.

I love this piece of the article:

Previous generations of politicians created Fannie and Freddie as a means of providing those benefits while pretending the costs did not exist. The companies were declared to be private during the fat years, and their shareholders profited handsomely, even as everyone understood that the government would stand behind the companies during the lean years.

That strategy has probably been exhausted, as Washington appears to have lost its appetite for implicit guarantees.

That leaves an unpalatable choice between making the cost of the system an explicit government obligation, or making it harder for Americans to buy homes. Any reduction in government support for the mortgage market is likely to increase the cost of home borrowing.

Plans to revive private sources of financing for mortgage loans also need to be harmonized with the government’s countervailing efforts to reduce risk-taking by financial institutions. Some analysts are worried that new rules and regulations will limit the ability or willingness of the market to finance mortgage loans.

Alex J. Pollock, a fellow at the American Enterprise Institute, said he was confident that lenders would learn to operate within the rules — or learn to go around them — but he added that the effort required to do so would be billed to the borrowers.

“Enterprising companies are very able to figure out how to deal with these regulations, but that’s not free,” he said. “The loans will cost more.”

Well, at least I can say that I didn’t vote for him.  Twice.

Advertisements

Obama is the worst president of my lifetime

Obama makes home ownership a thing of the past

Hyperbolic?  You be the judge.  Administration calls for cutting aid to homebuyers:

The Obama administration’s much-anticipated report on redesigning the government’s role in housing finance, published Friday, is not solely a proposal to dissolve the unpopular finance companies Fannie Mae and Freddie Mac.

Treasury Secretary Timothy Geithner said closing Fannie Mae and Freddie Mac might take five to seven years.

It is also a more audacious call for the federal government to cut back its broadly popular, long-running campaign to help Americans own homes. The three ideas that the report outlines for replacing Fannie and Freddie all would raise the cost of mortgage loans and push homeownership beyond the reach of some families.

That fact is already generating opposition in Congress and among groups like community banks and consumer advocates.

But administration officials said they had concluded the country could no longer afford to sustain its commitment to minting homeowners. Better to help some people rent

What is more sickening?  That this president who had everything going for him when he came into office would betray the American people like he has or that the gullible left put him in charge because they got all snooty over Bill Clinton’s comparatively reasonable welfare reform?

Read the whole thing.  It will make your blood boil.  What would make anyone want to buy a house after this?  How will current homeowners sell in the future?  What will developers buildinstead?  Highrises?  Will you only be able to rent your three bedroom house with all the restrictions on making structural changes and painting the walls?  Will a greater number of Americans be subject to landlords and evictions, fees and arbitrary rent increases?  Will their rental rights and property rights be protected and respected?  Who will enforce that?    What nutcase thought this was a good idea??

And what does it say for Obama’s attitude towards the middle class that he expects that we won’t be able to afford houses in the future?  What does he know and when did he know it?  Who are his friends?  What are they talking about behind our backs?  We better find out.

Presidentin’ Is Hard

Though I make no claims of being a financial wizard, or a political maven, even I can see that all is not right on Wall Street, D.C. where the heart and soul of our country is on life support, currently being administered to by second graders who want to be doctors when they grow up.  And, I’m sophisticated enough to recognize that a lot of what I read about our dire national situation is presented in the media by people representing the political party so far out of favor they have to look to bloviating blowhards for advice, or worse, can be made to appear to need to do so.  I get that.  However, in spite of all that, the forces pretending to represent the white-hatted good guys in this classic Adventures in Administration movie, armed with their heralded sky-high approval ratings for their poor man’s Dark Gable leading man, simply can’t mount enough of a stampede to disguise the fact that the dustcloud that follows them like Charlie Brown’s pal Pigpen’s is not the result of riding hard and strong over the dusty trail, but merely the wispy smoke trails from their “throw ’em off the path,” hastily built, diversionary cookfire.  In other words, they got nothing.

Stalwart bastion of the Obamedia protection service, Salon Magazine, has an article by former Clinton labor secretary and Obacolyte, Robert Reich, in which he pitifully attempts to pooh-pooh rightwing claims that the Obamessiah himself is responsible for our economic woes by trying to lay them at the feet of the finger-pointers:

When it turns out that people like Lloyd Blankfein, the CEO of Goldman Sachs, who took home $68 million in 1997, was the only Wall Streeter in a meeting last September at the New York Federal Reserve to discuss the initial AIG bailout with Tim Geithner, then New York Fed chair, among others, at the very time Goldman was AIG’s largest trading partner, a distinct scent of self-dealing begins to emanate. When it turns out that Citigroup got a bailout deal last October far more generous than that given to any other distressed bank, when a top Citi executive was advising the Treasury and Fed, the scent increases. Goldman’s past CEO was treasury secretary at that time, by the way, and another former Goldman CEO was a top Citi official and also a former treasury secretary. I am not suggesting anything so crude as corruption. But could it be, given these tangled webs, that — innocently, unintentionally, perhaps even subconsciously — the entire bailout effort was premised on saving these companies rather than protecting the public? Or that the distinction between the two was lost, and still is?

Yet, Reich gleefully and disingenuously, ignores the fact that the people he’s defending his ObaMaster against are the people who funded his campaign.  Not only that, the central figure in Reich’s little morality play, Turbo Tax Timmy Geithner, tax cheat, (TTTG,tc)  has a family history of sorts with Barry Sutoro, and is currently employed as the Blameless One’s lapdog and whipping boy.  To point out that he may have colluded with the banksters against the public in ripping off the country on the other team’s watch is…well…stupid.

Why would anyone purporting to defend the Obama administration draw attention to the man quickly becoming the public face of its incompetence?  Especially when the author can’t even make it through to the end of his own piece without acknowledging at least some of the complicity of the Obama Drama Troupe?

The Wall Street and Republican media attack machine doesn’t know exactly what to make of this. The Wall Street Journal’s editorial page, along with CNBC, alternates between attacking Obama for bailing out Wall Street and excusing Wall Street’s excesses. But then again, Obama doesn’t seem to know exactly what to make of it either. He seems to vacillate as well — one moment scorning Wall Street, the next moment justifying further bailouts. I do hope he takes a firmer hand, drawing a clearer distinction and making a clearer connection between clearing up these financial balance sheets and helping average people. Otherwise, the next populist uprising will be born in this moneyed quagmire. It is here — within the muck that was created by AIG, Citigroup, Fannie and Freddie, other giant financial institutions, now in combination with the U.S. Treasury and Fed — that the public is most confused, bears its most serious scars, and is potentially most burdened in future years, by decisions still made in secret.

Tuesday: Stop fooling around

The NYTimes was full of some pretty gruesome articles this morning.  For example, there was the announcment of the release of a book intended for medical personnel headed into the war zones of Iraq and Afghanistan.   The book, “War Surgery in Afghanistan and Iraq: A Series of Cases 2003-2007”,  had been under wraps by US Army censors because it shows men, women and children whose bodies have been damaged by war.  They don’t want to upset the delicate sensibilities of the American people who are funding such experiments in cutting edge medicine.

The battlefield treatments are amazing and innovative.  It’s just desperately sad that they are needed at all. Photographs in the book were taken by Pulitzer Prize winning photojournalist David Leeson of The Dallas Morning News.

Then, there is this piece, “At Freddie Mac, Chief Discards Warning Signs”.  Back in 2004 the warning signs of trouble in the home mortgage industry were presented to the head of Freddie Mac, Richard Syron, who said the corporation couldn’t say no to anyone.  Here’s a classic quote from Syron that Yes Man Extraordinaire, Barack Obama, should take to heart:

“If I had better foresight, maybe I could have improved things a little bit,” he said. “But frankly, if I had perfect foresight, I would never have taken this job in the first place.”

Ooo, here’s another cautionary quote for the Yes Man, he who has no coalitions of his own and will be completely at the mercy of the Blue Dogs in Congress with whom he has made his bed:

Indeed, executives of both companies maintain that one of the reasons the firms hold so many bad loans is that Congress has leaned on them for years to buy mortgages from low-income borrowers to encourage affordable housing. In 2004, Freddie Mac warned regulators that affordable housing goals could force the company to buy riskier loans.

Others, however, dismiss that explanation. “Sure, it’s hard to deal with the pressures of Congress and shareholders and regulators,” said a former high-ranking Freddie Mac executive. “But that’s why executives get paid so much. It’s not acceptable to blame those pressures for making bad choices.”

Yes, well, why is it always the guys who get paid the big bucks that end up costing us so much in money and lives?

A couple of weeks ago, I was listening to a podcast of Fresh Air with Terry Gross where she interviewed the chief economic strategists for the McCain and Obama campaigns. I love terry Gross and have listened to her for years so it pains me to hear how totally she is in the tank for Obama. (Sidenote: A couple of weeks before the economic strategists interview, she had one on the pension crisis with Theresa Ghilarducci from the University of Notre Dame.  Ghilarducci sounds like an FDR New Dealer and a Clintonista and Gross treated her like she was from Mars.  The last minute or so of the interview was so frosty and tense you’d think Terry was talking to Gene Simmons)

Terry’s interview with Jason Furman, Obama’s chief economic strategist, was notable not so much for Terry’s fawning but for Furman’s vague ideas.  As the conversation progresses, Furman starts to channel his inner child and he begins to sound like a floppy young puppy, all wide eyed and playful.  He’s all “REALLY” and “a LOT” and a “WHOLE BUNCH”.  Golly!   But underneath all that innocence, there are subtle signs that Obama is planning something not so nifty.  For example, when he talks about Social Security, Furman says:

“This is our most important program.  It’s REALLY important that we protect it, not just for people today but for generations to come.  Second of all, for middle class families, for a lot of them, it’s their only source of income… So it’s not something you would REALLY want to burden them with in the course of adjusting to that.”

Ok, Ok, stop right there.  “Adjusting” to WHAT exactly?  Terry never asks.  Furman goes on to describe the taxes on people making over $250K that would go up “a bit”.  Fine.  A little rate hike isn’t unreasonable.  But what is all of that middle class “Adjusting” about?  It sounds faintly familiar.  Like, when the Bushies were talking about privatizing and how there would be initial overhead but then we would all just have to settle for less in benefits down the road.  But anyway SS was insolvent and we’d all just have to get used to funding our own retirements through the fabulous new “instruments” that the Wall Street Peeps would set up to handle all of our retirement savings.  Is that the kind of “adjustment” that Furman is referring to?

Not that Terry cares much anymore.  I get the distinct impression that the poor or those in need of a safety net are really sad stories but not much she and HER class can do much about.  I mean, the Republicans will never allow for real reform.  So, the people who slip through the cracks are like Bangladeshis who get wiped out in the latest cyclone.  Terry and The Nation Letter Writer types just tsk-tsk, shake their heads in disbelief and say, “Those poor people, they shouldn’t farm so close to a major body of water on those rich soils of the delta plains.  What did they expect?  Pass me another canape, please. And did you see that new book with pictures of civilians caught in a warzone?  Revolting!”

Reminder: The Audacity of Democracy is currently filming all across the United States.

Let’s get this baby shot and in the can!  If you’re interested in becoming an associate producer or even making a small donation to this worthwhile endeavor, click here.